Search This Blog

Highlights: Union Budget 2012-13




Union Finance Minister Pranab Mukherjee on 16 March 2012, tabled the union budget in the parliament for the financial year 2012-13.

As per the Union Budget 2012-13, the growth in FY 2011-12 has slowed due to the global crisis with the Indian economy expected to grow at 6.9% with agricultural sector growing at 5.4% and services sector growing at 9.6% in financial year 2011-12 and the GDP growth expected during FY 2012-13 at 7.85%. The fiscal deficit is 5.1% of the GDP for the fiscal year 2013.

1. Fiscal deficit pegged at 5.1% for FY 13 from a revised 5.9% for FY 12. Original deficit for FY had been pegged at 4.6%. This represents a total slippage of INR 109,000 crores for FY12 over initial estimates. Fiscal deficit for FY 13 at INR 513,600 crs versus revised FY 12 of INR 521,980 crores


2. An unprecedented 93% of the fiscal deficit is to be borrowed via dated government bonds vs a still large 83.5% in FY12. This translates into a gross market borrowing of INR 569,000 crores (INR 510,000 crores in FY 12) and a net borrowing of INR 479,000 crores (INR 436,000 crores in FY 12)

The key highlights of the Union Budget 2012-13 as tabled in the Lok Sabha are as follows:

  • The personal income tax exemption limit will be raised to Rs 200,000 (Rs 2 lakh) from the existing Rs 180,000.

  • Senior citizens will have to pay no advance tax.

  • Individual will have to pay 10 per cent tax on income between Rs. 2 lakh and Rs. 5 lakh; 20 per cent between Rs. 5 lakh and Rs. 10 lakh; and 30 per cent for above Rs. 10 lakh.

  • Health insurance deduction up to Rs 5000 for preventive health checkup.

  • There has been no change in corporate tax.

  • Reduction in STT rate by 20% from 0.125% to 0.1%

  • Interest on savings account exempt up to Rs. 10,000

  • The homeowners of apartments can enjoy tax exemption of Rs. 5000/. Spent on maintenance. 

  • This exemption level has been increased from Rs.3000/- to Rs. 5000/-.

  • The Capital Gains Tax will not be applicable for people who use the amount generated from the sale of their houses as an equity investment in small and medium businesses.

  • Introduction of the “Rajiv Gandhi Equity Saving Scheme”  wherein small investors’ get annual tax exemptions on equity investments up to 50000 Rs with three years lock in. This new equity savings scheme to provide for income tax deduction of 50% for those who invest Rs.50, 000 in equity and whose annual income is less than Rs. 10 lakhs

  • Introduction of GST in August 2012 is proposed. Direct tax code (DTC) to be introduced in FY14.

  • Government has raised both standard excise and service tax rates from existing 10% to 12%.

  • New revised income tax return form ‘Sugam’ to be introduced for small tax payers

  • Infrastructure investment in 12th Plan to go up to Rs. 50 lakh crore; half of it to come from private sector

  • Tax free infra bonds to be raised to Rs. 60,000 crore

  • Excise duty proposed to be hiked to 12 percent

  • Bills on micro-finance institutions, national land bank and public debt management among those to be introduced in 2012-13

  • Turnover limit for compulsory tax audit for SMEs raised from Rs. 60 lakh to Rs. 1 crore

  • Time limit for reopening of assessment raised to 16 years

  • A central "Know Your Customer" depository to be developed in 2012-13 to avoid multiplicity of registration and data upkeep.

  • Gold will become costlier as customs duty on standard gold increased up to 4% from the current 2%, non- standard gold to 10% from 5%.


No comments:

Post a Comment

Blog Archive

Scan this QR code using a bar code scanner on your smart phone to get instant information about us

Scan this QR code using a bar code scanner on your smart phone to get instant information about us
Investing Can be Interesting & Financial Awareness

Popular Posts

Golden Rules for Investing

Golden Rules for Investing
Golden Rules for Investing